The US dollar slumped today as the G-20 meeting failed to provided any reasonable plan on how to avoid the competitive devaluation of the currencies across the world, fueling the speculation about future quantitative easing by the Federal Reserve.
While the problem of the “currency wars” was discussed on the meeting, the participants haven’t decided on any actual measures to prevent forceful weakening of the currencies of the various countries. Japan announced that it’s ready to prevent any excessive gains of its currency. There’s no reason to believe that other countries wouldn’t follow Japan, also weakening their currencies. For the US dollar that means the quantitative easing.
EUR/USD went up from 1.3950 to 1.4037 as of 8:45 GMT, following the advance to 1.4080.
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